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Printing Money == Borrowing Money in our modern banking systems. And borrowing is often exactly how this gets funded. Also, it's not just about the money suppl
by Nifty3929 4y ago
Printing Money == Borrowing Money in our modern banking systems. And borrowing is often exactly how this gets funded.
Also, it's not just about the money supply. It's about who has the money and what they do with it.
Taking money from a rich person who might have had it tied up in stock, and giving it to a poor person who takes it to the grocery store - will not put anything more on the shelves in that grocery store. In the aggregate, it MUST do one of those three things. It may ALSO decrease the price of stock as it's sold by the rich people.
Clearly the economy is complicated, and it's hard to follow around the money. That's why I like to get back to fundamentals. Not even economics, but basically physics: We can't consume what isn't produced. Money is to some degree beside the point. If we want people (of any class) to have more stuff, then we must allow for that stuff to be produced.
- RhodesianHunter 4y ago>Printing Money == Borrowing Money in our modern banking systems. Not exactly. Printing simply introduces new money supply. Borrowing (or selling bonds in our case) comes with a corresponding liability that decreases the supply over time in an aggregate amount greater than the original amount, and results in a corresponding difference in behavior from the borrower.